If poor communication costs U.S. hospitals billions per year, how costly — aside from the moral costs — will socialized medicine be for Americans if it becomes a reality?
Researchers from the University of Maryland’s Robert H. Smith School of Business put a price tag on the cost of poor communication in U.S. hospitals at $12 billion per year.
The research (pdf), newly released from the Center for Health Information and Decision Systems, is the first to quantify the economic impact of a health care system rife with communication delays and failures. Among key findings was unnecessarily long hospital stays — such as the time and resources patients squandered while waiting to be discharged — that account for 54 percent of total losses.
To put the $12 billion in losses into perspective, it’s equal to approximately two percent of hospital revenue nationwide, a figure that is more than half of the average hospital margin of 3.6 percent.
Thoughts?
7 responses so far ↓
1 Brian Simpson // Mar 9, 2009 at 11:23 pm
So,
This research if done on any other industry would likely find the same results. The health care industry does however have some factors that make it likely that it won’t reduce that waste. One of the biggest is the predominance of fee-for-service payment structures. There is almost an incentive to use something so you can charge insurance for it.
2 hotoffthepress2 // Mar 10, 2009 at 5:24 am
Thanks for the input, Brian.
3 Government Watch: Economy, Obama File, March 10th 2009 « Lighthouse Patriot Journal // Mar 10, 2009 at 8:24 am
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4 JUAN // Jun 7, 2009 at 3:00 pm
There is actually an incentive to have poor communication in healthcare, and that incentive is $$$. Systems are paid for procedures and time, and they are paid more for duplication due to poor communication.
5 JUAN // Jun 7, 2009 at 3:02 pm
Our present healthcare system, driven by profit, sucks, doesn’t it? We need reform. Now.
6 hotoffthepress2 // Jun 7, 2009 at 3:04 pm
Sure, we need reform in the form of less government intervention and control of trial lawyers whose efforts drive up health care costs for everyone.
7 Adam // May 5, 2010 at 6:09 pm
Well lets look at the big picture here. Hospitals are not soley at fault for digging a hole in their profit margins. Patients certainly share a portion of the bill. Taking proactive decisions and keeping an ongoing relationship with your primary physician is vital.
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